Baidoa Online | June 18, 2026 - The United States and Iran have signed a landmark Memorandum of Understanding, formally ending months of conflict and opening a 60-day window for final peace negotiations.
US President Donald Trump signed the agreement at the Palace of Versailles in Paris on Wednesday night, following a state dinner with French President Emmanuel Macron. Iranian President Masoud Pezeshkian also signed the document.
Key points of the 14-point agreement:
- Iran will not develop or procure a nuclear weapon
- The Strait of Hormuz will reopen — toll-free for the first 60 days
- The US will remove its naval blockade within 30 days
- All US economic sanctions on Iran will be lifted
- A $300 billion reconstruction fund for Iran is proposed
- Both sides commit to reaching a final deal within 60 days, extendable by mutual consent
- All military operations to cease, including in Lebanon
Despite the signing, tensions remain. Trump warned the US would "bomb the hell" out of Iran if it violated the terms, while Iran's chief negotiator Mohammad Bagher Ghalibaf said distrust of the US remains and Iran's "finger is on the trigger."
Prime Minister Benjamin Netanyahu has made no secret of his opposition to any deal that leaves Iran's regional influence intact. Israel was not part of the negotiations and views a reconstructed, sanctions-free Iran as a direct threat to its security. Israeli forces continued striking targets in Lebanon even after the deal was announced, with Iran warning those strikes constitute a violation of the agreement.
The war sent shockwaves through global markets. The Strait of Hormuz carries roughly 20% of the world's oil supply, and its blockade drove energy prices to punishing levels, accelerating an already fragile global economic downturn. The reopening is expected to bring immediate relief to oil markets and ease inflationary pressure squeezing economies from Europe to East Africa.
However this is a ceasefire, not a final peace deal. Iran's nuclear programme remains unresolved, the $300 billion reconstruction fund has no clear funding mechanism, and with both sides openly declaring they still don't trust each other, the 60-day window for a permanent agreement will be extremely difficult to navigate.
